Housing Remains Strong

Mortgage Market Sees 4 Percent Gain in July

By Andy Meek

The way BankTennessee mortgage specialist Jessica Campbell sees it, conditions in Shelby County’s current residential real estate market are about as favorable as the industry could hope for.

A new home for sale at the corner or Blythe Street and Southern Avenue in the Cooper-Young Historic District probably won’t stay on the market very long. (Daily News/Houston Cofield)

A mix of high demand, rising home values and low interest rates holding steady are among the factors she and her colleagues say are behind the 4 percent gain in purchase mortgage volume that kicked off the third quarter in July, compared to July 2016. That’s according to data from real estate information company Chandler Reports, www.chandlerreports.com.

Fueling that percentage increase was mortgage volume growth from about $204.1 million in July 2016 to $212.2 million last month.

“Sellers are typically getting their asking price, and some have competing offers,” Campbell said of current market conditions. “Most homes are only on the market a few days, and some are contracted before the real estate sign is in the yard.”

While rates started to tick upward a few weeks ago, they’re still holding steady, and business is still booming at Campbell’s bank – a pace she expects to continue through the rest of the year.

Continuing the trend that closed out the second quarter, July posted similar increases as seen in June, when volume rose 7 percent over June 2016. In July, lenders completed more mortgages, meanwhile, though the average mortgage size was smaller than those made in July 2016.

From July 2016 to July 2017, the Chandler Reports numbers show 9 percent more mortgages – an increase from 1,018 to 1,110. The average mortgage amount slipped from $200,552 to $191,190 during the same period.

Top July Lenders By Purchase Mortgage Volume

PINNACLEJuly 2016: $11.8MJuly 2017: $14.5M

COMMUNITY MORTGAGE CORP.July 2016: $13.6MJuly 2017: $14.4M

IBERIABANKJuly 2016: $17MJuly 2017: $14M

Source: Chandler Reports, www.chandlerreports.com

Tommie Criswell, vice president and broker-manager for the East Memphis Crye-Leike Realtors office, expects the same conditions to stay in place through year-end. That includes rates hovering at continued low levels.

“We’re still experiencing extremely attractive rates for all mortgage loan categories,” she said. “Most loans are at or below 4 percent and have held at that level for some time. Even though the Federal Reserve made two quick (interest rate) increases earlier in the year, our mortgage market did not experience significant upward adjustments in rates.”

That is good news for the Memphis real estate market as it enters the back half of 2017.

“Now is a great time for sellers to sell and buyers to buy,” Criswell says.

That’s pretty much the pace that’s been evident since Jan. 1. Volume year-to-date through the end of July hit $1.2 billion, up 9 percent from a little more than $1 billion in volume from Jan. 1 through the end of July 2016, the Chandler figures show.

One metric that saw a noticeable slip in performance is the average mortgage amount. Lenders year-to-date are making more mortgages, but for either the same or smaller amounts.

Lenders made 6,504 mortgages year-to-date through the end of July, up from 5,958 mortgages over the same span in 2016. The average mortgage amount year-to-date, though, was $180,503 at the end of July, pretty much the same as the $180,167 recorded at the same point in 2016.